Tax turmoil

Walter Bannon, part-owner of Bannon's Gas Bar, said the business owes $1.6-million after a Ministry of Finance audit found ineligible gas tax exemption cards were taken.

By Matt Vis, tbnewswatch.com

THUNDER BAY – A Fort William First Nation gas bar is in hot water over allegedly taking improper gas tax cards.

Bannon’s Gas Bar, which is located at the intersection of Chippewa Road, City Road and James Street, was the subject of a provincial Ministry of Finance audit where it has been determined ineligible gas tax exemption cards were used.

Walter Bannon, who is among the owners of the more than 40-year-old business which includes J&W Confectionary and Charlie’s Grill and Pizza, says the gas bar has been following the applicable laws to the best of their ability.

“We have used their Gasoline Tax Act where there are provisions in it for vendors to follow what must be done for the cards to be taken. We have not violated that in any way and still they have deemed us to be wrong in taking these cards,” Bannon said Friday.

The audit, which took a sample from the past three years, found that more than 60 per cent of the rebate claims were from ineligible cards. Bannon said the gas bar owes around $1.6-million as a result.

The exemption cards, which are white and do not have any photo identification, can be deemed ineligible for reasons including if the card is expired, used by a person other than the cardholder or used for a vehicle other than the one owned by the cardholder.

It is up to the gas bar to record the cardholder’s name and license plate to claim reimbursement for the rebate, which is 14.7 cents per litre.

Bannon alleges the province has made it up to each gas bar to determine if a card is being used fraudulently, rather than enforcing the individuals using them.

Placing the responsibility to police the use of the cards onto the independent establishments is “not fair,” Bannon said.

“I don’t have the luxury of going through computer programs to find out if there is right license plates or volumes each people can take,” he said.

The business has consulted a team of lawyers, tax auditors and lobbyists to try to work with the Ministry of Finance as well as the Ministry of Aboriginal Affairs to find a remedy. Bannon said a repayment schedule was submitted but was subsequently denied.

The process and lack of communication is frustrating, he said.

The situation has led to Bannon’s continuing to selling gas at the rebate rate to customers with the cards, but without the government reimbursement.

Combined with the hit of a fire in the restaurant last year, declining revenues from the ongoing closure of the James Street Swing Bridge, the business might have to close its doors if the matter doesn’t get settled.

“For the past four months I’ve been running this operation without the 14.7 cents,” Bannon said.

“Our suppliers had helped us finance up to this point and we’re maxed in terms of assistance from them. Now it’s a matter of that 14.7 cents catching up to us and eroding the cash flow away until I get in a position where we are done.”